Goldman says play defense with these stocks if you're worried about the AI bull failing
These defensive stocks, some of which have lagged, could be ready rally as investors bail on AI trade.
TL;DR
- Goldman Sachs recommends health care and consumer staples stocks for investors worried about the AI trade.
- Concerns about rising capital costs and the AI buildout's durability are pressuring equity markets.
- Defensive industries with 'quality' attributes, especially recent laggards, are advised for focus.
- Tyson Foods and CVS Health are mentioned as examples, with details on their free cash flow yields and stock performance.
- Goldman's base case still anticipates earnings growth, with a potential catch-up trade in consumer-facing stocks.